Developing Leaders: Training is not enough

This year’s SEEP Network conference featured Peg Ross, Director of the Human Capital Center on a panel titled “Meeting a Critical Need: Leadership for the 21st Century MFI.”

At their SEEP panel, Peg Ross, along with Kathryn Mayer, Director for the Center for Microfinance Leadership at Women’s World Banking and Glynis Rankin, founding Director of Creative Metier Limited attempted to answer a key question for the industry: How can MFIs develop skilled leaders focused on the double bottom line and build meritocratic organizations [where everyone is promoted and rewarded according to their ability] in a fast changing and increasingly commercialized and competitive marketplace?

As organizations grow, transform, and add additional product offerings to better serve their clients they are adding “increasing complexity at all levels of the organization.” Specifically, Peg explained, “there’s tremendous complexity that occurs at the field level – with the leaders from the field. As an organization grows and scales this issue of complexity needs to be dealt with.” For example, decision making must be decentralized to the lowest appropriate level within the organization and accordingly, individuals should be not only held accountable for business results, but also given the support necessary to deliver.

These field leaders are the backbone of microfinance institutions around the world. They can inspire the loan officers and branch managers they work with and when they are empowered with the proper level of decision making capability, they can drive the growth and impact of their institutions.

Figuring out how best to develop these mid-level leaders is key as organizations seek to expand their operations and delve deeper into the markets they serve. Peg also emphasized how “it’s important to deliver learning opportunities that are not just classroom based. Learning is about getting information in a just-in-time manner and then having the opportunity to apply that in your every-day job.”

Grameen Foundation’s Human Capital Center completed in-depth field research in India this past May with four different MFIs to understand the challenges and opportunities mid-level leaders face every day, and explore what these field leaders themselves identified as the most valuable learning opportunities. Some of the ways mid-level managers say they learn are:
– Shared experiences with peers – Comparing notes with other managers on how to approach certain issues. This was one of the most valuable ways these leaders said they new perspectives.
– Observing others – Watching previous supervisors deal with complex situations provided inspiration for many of these managers when they eventually stepped into similar roles.
– Learn by doing and teaching others – On the job learning was consistently praised.

The Human Capital Center hopes to help the microfinance sector shift its thinking from learning as only structured, classroom-based training to a more creative approach involving just-in-time learning delivered in the field through more integrated learning approaches. Stay tuned for continued updates on the Human Capital Center’s progress on this important initiative.